Cablevision gains on report of possible asset sale

By Susan Rush
From The September 16, 2002 Edition Of CED Broadband Direct

Cablevision's Chairman Charles Dolan told the New York Times that the seventh-largest cable operator may look to sell its cable TV systems. The statement sent Cablevision's stock higher.

At one point in morning trading the company's shares were rallying, up more than 7 percent. In the Times interview, Dolan said the company may consider shedding its cable assets in New York, especially if AOL Time Warner Inc. was the buyer. The companies could easily combine their NYC assets because their footprints overlap, he said.

"While we are not suggesting that CVC will be sold any time soon, we continue to believe that there are a number of potential catalysts that could take the shares higher over the next 12 months," Salomon Smith Barney analyst Niraj Gupta said in a research note.

Analysts have speculated that Cablevision may look to shed its cable TV systems for some time now, but "Mr. Dolan appeared to take his most public stance on the possible sale of CVC's cable systems," Gupta said in the note. Gupta speculated that if Cablevision sold its cable systems assets it would likely fetch between $20 and $25 per share, which would translate to as much as $4,600 per subscriber. Cablevision serves roughly three million subscribers in New York.

Salomon Smith Barney believes a sale of the company's wireless assets is "likely."